Home media storage solution

Buy a Drobo. It's cheaper than a new computer (of any decent quality), smaller, quieter, and does a better job of storing an expanding dataset reliably (single-drive failures are no problem).

You can expand them without losing any data, and even while the volume is still online and being accessed (it just slows down a bit during the upsizing).

I've owned one for quite some time now, and they're the shiznit.

Zero maintenance, just replace drives if and as they fail over time. No patching, no vulnerabilities, no headaches. It does what it does better than any computer can, and you can start out with smaller drives now and replace them as you need to grow, keeping your cash outlay smaller up front.

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Update re building a base-level PC and doing the RAID yourself: By the time you buy all the parts to make a machine of decent reliability (you do care about your data, right?), how much will you have spent? How much is your time worth to mess around with the hardware and with Linux to get everything set up and configured -- plus the hassle to keep Linux patched as time goes on?

The base-model Drobo (four drive bays, USB 2.0, FireWire 800) is $399:

http://www.drobostore.com/store/drobo/en_US/buy/productID.111373000

You can even buy them preloaded with drives, which may or may not make sense for your application.

That's not much of a premium over rolling your own, and you won't get the sort of in-place upsizing the Drobo offers. There's even a $50 mail-in rebate until the end of March, making it $349.

http://www.drobo.com/mir/DroboRebate-US.pdf

Build a new computer. Your budget is too low for specialized hardware which is often overpriced because of its "speciality" and all it does is being computer with few features.